Thought Exchange

Pacific Gas & Electric: An ESG Returns Story

This piece highlights the compelling ESG story which has played out with PG&E bonds in recent years in relation to wildfires in northern California. Major wildfires linked to PG&E equipment and ensuing litigation claims from the Californian state and private actors led to PG&E filing for Chapter 11 bankruptcy protection in January 2019. Further wildfire risks since have seen PG&E repeatedly shut off power to much of Northern California, and a state takeover has been threatened.

Over recent years, traditional credit analysis from the market appears to have under-represented inherent risks relating to PG&E issues. Incorporation of ESG factors, though, can facilitate a more informed choice around risk and return seeking, which may help some better consider the value they assign to power companies such as PG&E.

At Cameron Hume we fully integrate ESG factors into all of our clients’ portfolios in order to support our decision making as fully as possible.

Cameron Hume Limited, a company incorporated in Scotland (company number SC408024) having its registered address at Exchange Place 1, 1 Semple Street, Edinburgh, United Kingdom EH3 8BL. Authorised and regulated by the Financial Conduct Authority (FCA Register Number 579495).